Williams will stay with the company but instead focus on product strategy, which is his "passion." Twitter COO Dick Costolo will become the company's new CEO immediatly. Costolo has been in charge of creating revenue sources for the young company, which wil be Twitter's focus moving forward.

The move has been in the works for over a year, according to Williams. He said he requested that Costolo become the new leader of the company 12 months ago but was met with questions from Twitter's board.

But now was the right time.

"I’m extremely proud of how far Twitter has come in the last two years," he wrote on his blog. "And, I couldn’t be more excited about where our amazing team will take it next."

Under his watch, Twitter has grown from a fringe social networking site into one integrated with television shows and with a valuation of over $1 billion.